Despite gloom, PLO foresees brighter times WAR IN THE GULF

AMMAN, Jordan -- For the Palestine Liberation Organization, things look bleak right now, but there are hopes for a brighter future once the war is over, if not before.

On the public relations front these days, archenemy Israel, recently known as the nation that answered stones with bullets, is now known as the country that turned the other cheek for the benefit of the Persian Gulf allies even as Scud missiles fell on its cities.

Then there is the matter of the PLO's shrinking bank account. When Chairman Yasser Arafat cast his lot with Iraqi President Saddam Hussein, PLO financial backers in the anti-Iraq alliance -- such as Syria and Saudi Arabia -- zipped shut their purses, at an estimated loss to the PLO of $8.5 million.

Taking shelter at the center of this storm is Mohammed Milhema member of the PLO Executive Committee and head of its department of occupied territories.

A recent morning found Mr. Milhem, 61, busy behind his desk at a PLO office in Amman, where some windows were crisscrossed with tape and others were shuttered with steel.

On a wall facing his desk was a large map that depicted thborders of Israel. But the name within the borders said only "Palestine."

Mr. Milhem acknowledged that this is not the best of times fosuch dreams, nor for his organization.

"Any tension between the PLO and any Arab state naturally brings harm to the Palestinians in one way or another," he said. "Financial backing is important for our needs as a people and our struggle. But the absence of this financial backing doesn't mean it is the end of the Palestinian struggle."

Far more bothersome to him than the loss of money is the way Israel has earned the world's sympathy by bearing up to missile attacks.

He has also been distressed to see that the world's sympathtranslates into gifts of money, missile defense systems and better foreign relations.

The woes of the Palestinian intifada, a struggle largely of rock-throwing youths against Israeli rule on the occupied West Bank and Gaza Strip, has garnered international sympathy over its three-year span, he said. But now, Mr. Milhem said, "We receive only a few headlines in the newspapers, a few paragraphs here and there. Sympathy is not enough. Israel gets material results."

Helping to counterbalance Israel's gains, he said, is the psychological boost some Palestinians have got from the missile attacks. "It has raised the hopes of these people that no more is Israel a fearful, supernatural being," he said. "It shows that Israel has no secure borders and will continue to be violated until they recognize the rights of the Palestinians."

Mr. Milhem's career shows how intensely personal the struggle against Israel is for many Palestinians. The mayor of the West Bank village of Halhoul, he was expelled by the Israelis in 1980 for his pro-PLO sympathies.

These days he rarely ventures to within sight of the West Bank. He especially avoids the shores of the Dead Sea. It is from there that he can see the hill where his old home stood, and he does not want to be reminded of what he has lost.

Such passions among the world's 4 million Palestinians and their numerous supporters in the Arab world will keep the PLO strong in some quarters, he said. And once the dust of the war settles, he maintains, the PLO will still be a formidable force in Middle East dealings. It is a view that many Western diplomats share.

The PLO's rejuvenation might come even sooner, Mr. Milhesaid, if the war takes a particularly nasty turn, either toward more bloodshed among Iraqi civilians or toward a widened conflict.

Such developments, he said, would further unite the region'growing Arab nationalism and Islamic fundamentalism behind the Palestinian cause.

"It will create a global intifada, an Arabic and Muslim intifada," he said, "and an awakening to the fact that the aim of these invading countries is to destroy any Arab state which poses a threat to Israel or to the interests of the West.

"Whatever the losses of the war, it will bring back a solution tthe problems of the Middle East and will bring back dignity to the Arabs. But it is going to be devastating to everybody, including Israel and the interests of the West."